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Margaret represents insurers in connection with coverage issues and disputes arising under professional liability and general liability insurance policies. Margaret, a certified Legal Lean Sigma Institute (LLSI) White Belt, uses the LLSI process and project management tools to continually improve the value proposition the firm delivers to its clients.

The United States District Court for the Northern District of Texas, applying Texas law, has held that an insured’s late notice of a claim bars coverage, rejecting arguments that (i) the initial complaint did not constitute a “claim” because it did not allege a “wrongful act;” (ii) notice to the broker was sufficient; and (iii) the issuance of a renewal policy on different terms triggered the automatic extended reporting period. Vela Wood PC v. Associated Indus. Ins. Co., 2020 WL 5440496 (N.D. Tex. Sept. 10, 2020).

Continue Reading Texas Court Holds Late Notice Bars Coverage

In a case in which Wiley represented the insurer, the United States District Court for the Eastern District of Virginia, applying New York law, has held that three prior knowledge exclusions barred coverage under an architects and engineers professional liability policy as a matter of law where, before the policy period incepted, the insured (1) knew that a pressure vessel in a boiler system which it had serviced had exploded, causing property damage and bodily injury; (2) received three pre-suit letters from potential claimants; and (3) issued two internal litigation holds.  ChemTreat, Inc. v. Certain Underwriters at Lloyd’s of London, No. 19-cv-63 (E.D. Va. Sept. 21, 2020).

Continue Reading Prior Knowledge Exclusions Apply Where Insured Received Three Letters from Potential Claimants and Issued Two Litigation Holds Before Policy Incepted

The United States Court of Appeals for the Eleventh Circuit, applying Georgia law, has held that an insurer has a duty to defend a lawsuit where an award of attorneys’ fees might constitute covered “Loss,” even though the lawsuit did not otherwise seek covered amounts.  AEGIS Elec. & Gas Int’l Serv. Ltd. v. ECI Mgmt. LLC, No. 19-11114, 2020 WL 4359610 (11th Cir. July 30, 2020).

Continue Reading 11th Circuit Holds Insurer Must Defend Lawsuit Where Award of Attorneys’ Fees Was the Only Potentially Covered Relief

The United States District Court of Connecticut, applying federal law, has denied an insured’s motion to dismiss or stay the insurer’s first-filed declaratory judgment action in deference to a subsequently filed, substantially similar coverage action filed by the insured in California state court, holding that the relevant factors weighed in favor of retaining jurisdiction over the first-filed declaratory judgment action.  Continental Cas. Co. v. Phoenix Life Ins. Co., No. 19-cv-1448 (D. Conn. August 10, 2020).

Continue Reading Connecticut Federal Court Declines to Dismiss First-Filed Declaratory Judgment Action in Deference to Insured’s California State Court Action

The United States District Court for the Southern District of West Virginia, applying West Virginia law, has held that claims against a surgery center arising out of medical procedures performed by a doctor while patients were anesthetized, primarily related to alleged sexual abuse, were “related claims” subject to a single limit of liability pursuant to a sexual misconduct endorsement.  Allied World Surplus Lines Ins. Co. v. Day Surgery Ltd. Liab. Co., 2020 WL 1545881 (S.D. W. Va.) (Mar. 31, 2020).  However, the court held that the surgery center’s excess policy, which did not contain a sexual misconduct endorsement, did not cover claims arising solely out of sexual abuse.

Continue Reading Claims Arising Out of Alleged Sexual Abuse by Doctor are “Related Claims” Subject to Single Limit of Liability Under Sexual Misconduct Endorsement

An Illinois intermediate appellate court, applying Illinois law, has held that an insurer must defend an attorney against a malpractice claim seeking damages for alleged negligence in the amount of fees paid to the attorney, concluding that the “legal fees” exclusion in the policy did not apply because the injury suffered by the claimant was not a consequence of the lawyer’s fees.  Illinois State Bar Ass’n Mut. Ins. Co.  v. Canulli, No. 1-19-0142 (Ill. App. Ct. March 13, 2020).

Continue Reading Insurer Must Defend Legal Malpractice Claim for Damages in the Amount of Fees Paid, Despite Carve Out of “Legal Fees” from Definition of “Damages”

The United States Court of Appeals for the Fifth Circuit, applying Texas law, has held that an insurer could not deny coverage due to the insured’s failure to comply with “immaterial” conditions of notice, absent a showing of prejudice, where an insured complied with its “material” obligation to report a claim.  Landmark Am. Ins. Co. v. Lonergan Law Firm, P.L.L.C., 2020 WL 833068 (5th Cir. Feb. 19, 2020); Landmark Am. Ins. Co. v. Lonergan Law Firm, P.L.L.C., 2020 WL 3024842 (5th Cir. June 4, 2020) (denying petition for rehearing en banc and issuing substitute opinion).

Continue Reading Absent Prejudice, Breach of Notice Conditions Does Not Relieve Insurer of Coverage Obligations

In a win for Wiley Rein’s client, the United States District Court for the Southern District of Florida, applying Florida law, held that, as a matter of law, a lawsuit against an engineer arising out of three alleged errors in connection with a construction project constituted a single “claim” under the engineer’s claims-made-and-reported architects and engineers policies. Nova Southeastern Univ., Inc. v. Continental Cas. Co., No. 18-CIV-61842-RAR (S.D. Fla. Dec. 27, 2019).  Furthermore, the court held that the policies’ prior knowledge and prior notice provisions separately and independently barred coverage for the lawsuit.

Continue Reading Lawsuit Arising Out of Three Design Errors is a Single “Claim,” and Prior Knowledge and Prior Notice Provisions Bar Coverage

The United States District Court for the Southern District of New York, applying Connecticut law, has concluded that a fraud exclusion is not triggered where an insured unwittingly transferred a client’s funds to third-party fraudulent actors based on spoofed emails, because the fraudulent acts were not committed by the insured.  SS&C Techs. Holdings, Inc. v. AIG Specialty Ins. Co., No. 19-cv-7859 (S.D.N.Y. Nov. 5, 2019).

Continue Reading Fraud Exclusion Inapplicable Where Insured Unwittingly Transferred Funds to Fraudsters